Top 5 Things to Know in the Market on Monday, June 29th

This post was originally published on this site — Worldwide Covid-19 infections top 10 million on the back of last week’s surge in the Americas and India, but two days of declines in new infections in the U.S. are helping stocks to a mixed opening. Facebook (NASDAQ:FB)’s ad boycott troubles deepen, while there’s a shaft of light in the sky for Boeing (NYSE:BA). In the oil and gas sector, Chesapeake Energy (NYSE:CHK) files for bankruptcy while BP (NYSE:BP) exits the petrochemicals business. Here’s what you need to know in financial markets on Monday, June 29th

1. Covid cases top 10 million but U.S. new cases edge down

The number of coronavirus infections worldwide topped 10 million, with over 501,000 reported deaths, according to Johns Hopkins data.

New infections in the U.S. fell for the second straight day on Sunday after hitting a record of over 42,000 on Friday, a surge that led Texas to order the closure of bars and suspend elective surgery at its hospitals to free up capacity for Covid-19 cases.

Alongside the southern and western U.S., the steepest increases continued to be in Latin America, notably Brazil and Mexico, and in India.

2. Facebook’s boycott troubles

The number of large advertisers boycotting Facebook’s two big social media platforms because of its perceived failure to address the spread of hate speech and disinformation keeps on rising.

Over the weekend, Pepsico (NASDAQ:PEP), Starbucks (NASDAQ:SBUX) and drinks group Diageo (LON:DGE) (the maker of Guinness and Johnny Walker) all said they would pull their ads from Facebook’s networks, joining consumer giant Unilever (NYSE:UL), Verizon (NYSE:VZ), Coca Cola and others who took the step last week.

Facebook stock, which fell over 8% on Friday, lost another 2.3% in premarket trading.

3. Stocks set to open mixed; 737 MAX test lights to resume

U.S. stocks are set to open mixed, amid cautious relief at two days of falling numbers of new Covid-19 cases.

By 6:30 AM ET (1030 GMT), the Dow Jones 30 Futures contract was up 83 points while the S&P 500 futures contract was up 0.2% and the Nasdaq 100 futures contract was down 0.3%.

Among stocks likely to be in focus Monday will be Boeing, after reports that the Federal Aviation Administration will allow test flights for the 737 MAX to resume as early as Monday after a 15-month grounding.

In addition, there will also be data on pending home sales at 8 AM ET and the Dallas Federal Reserve Bank’s regional business survey, which may shed light on the stress in the state’s oil and gas sector and, perhaps, its healthcare system.

4. Chesapeake goes under, BP ditches petchems

The stress in the shale patch was in full view over the weekend, as Chesapeake Energy, a pioneer in fracking, finally collapsed under the weight of its debts after enduring years of low natural gas prices.

The company, which has paid the price for not pivoting to more lucrative oil prospects, has some $11.8 billion in debts, according to its Chapter 11 filing.

In Europe, meanwhile, BP continued to sell assets to reduce leverage and keep its dividend payout going. The U.K. major said it would exit the petrochemical business by selling out to U.K.-based Ineos for $5 billion. That’s one-third of its total targeted asset sales by the end of 2021.

5 Oil stabilizes after Covid-19 fears hit demand outlook 

Crude oil prices stabilized after falling over the weekend due to fears that the further spread of the coronavirus will weaken any global economic recovery.

By 6:30 AM, U.S. crude futures were up 0.1% at $38.56 a barrel, while the international benchmark Brent was flat at $40.09 a barrel.

Prices were depressed earlier by a report saying that five of the biggest Chinese oil importing firms will join forces to buy collectively, aiming to improve their bargaining power with producers. The news comes amid record levels of crude being stored off the Chinese coast in tankers, amid haggling over prices.

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